USPAP USPAP Residential Appraiser 5 — Questions and Answers
Question 1: Under USPAP, which of the following statements about 'intended users' is correct?
- Intended users are determined solely by whoever pays for the appraisal
- The client is always the only intended user
- The appraiser identifies intended users based on communication with the client at the time of the assignment (Correct answer)
- Any party who reads the report is considered an intended user
Correct answer: The appraiser identifies intended users based on communication with the client at the time of the assignment
Intended users are identified by the appraiser through communication with the client at the time of assignment engagement.
Question 2: A residential appraiser is asked to complete a 'desktop appraisal' without a physical inspection. Under USPAP, this is:
- Prohibited under all circumstances
- Permitted if the scope of work is appropriate and the appraiser identifies all extraordinary assumptions used (Correct answer)
- Permitted only for properties under $500,000
- Prohibited unless the property was inspected within the prior 12 months
Correct answer: Permitted if the scope of work is appropriate and the appraiser identifies all extraordinary assumptions used
USPAP does not require a physical inspection; a desktop appraisal is permissible when the scope of work is appropriate and any assumptions are disclosed.
Question 3: The USPAP concept of 'exposure time' is best defined as:
- The time from the contract date to the closing date
- The estimated length of time the property would have been on the market prior to a sale at market value (Correct answer)
- The period during which the appraisal report is valid
- The time required to complete the appraisal assignment
Correct answer: The estimated length of time the property would have been on the market prior to a sale at market value
Exposure time is the estimated reasonable period the property would have been on the market before a hypothetical sale at its market value conclusion.
Question 4: Under USPAP, when is a 'departure' from a specific requirements of Standard 1 permitted?
- When the client waives the requirement in writing
- When the assignment involves a non-complex property
- Never — Standard 1's binding requirements cannot be departed from (Correct answer)
- When the appraiser's experience exceeds 10 years
Correct answer: Never — Standard 1's binding requirements cannot be departed from
USPAP does not contain a Departure Rule; binding requirements of Standard 1 cannot be departed from under any circumstances.
Question 5: A residential appraiser is engaged to provide an appraisal review of another appraiser's report. Which USPAP standard governs this assignment?
- Standard 1
- Standard 2
- Standard 3 (Correct answer)
- Standard 5
Correct answer: Standard 3
Standard 3 governs the development of appraisal reviews, and Standard 4 governs the reporting of appraisal reviews.
Question 6: Which of the following best describes an 'appraisal' under USPAP as distinguished from an 'appraisal review'?
- An appraisal forms an opinion of value; an appraisal review forms an opinion about another appraiser's work (Correct answer)
- An appraisal is always written; an appraisal review may be oral
- An appraisal requires a physical inspection; an appraisal review does not
- An appraisal is regulated; an appraisal review is unregulated
Correct answer: An appraisal forms an opinion of value; an appraisal review forms an opinion about another appraiser's work
An appraisal develops an opinion of value, while an appraisal review develops an opinion about another appraiser's work, processes, and conclusions.
Question 7: Under USPAP's Jurisdictional Exception Rule, an appraiser may depart from a USPAP requirement when:
- The client requests an exception for business reasons
- Compliance would be contrary to applicable law or regulation in the jurisdiction (Correct answer)
- The property type is not commonly found in USPAP guidance
- The appraiser has more than 20 years of experience in the jurisdiction
Correct answer: Compliance would be contrary to applicable law or regulation in the jurisdiction
The Jurisdictional Exception Rule allows an appraiser to depart from a USPAP requirement only when compliance would violate applicable law or regulation.
USPAP USPAP Residential Appraiser 5
Under USPAP, which of the following statements about 'intended users' is correct?